Tax 2.105 (4) (a) 1. f. Note: Decisions of the U.S. tax court and other courts ordinarily become final as follows:
a. If no appeal is made of a U.S. tax court decision, it becomes final upon expiration of a period of 90 days after the decision is entered. Decisions in unappealable cases involving deficiencies of $10,000 $50,000 or less heard by the U.S. tax court under section 7463 of the Internal Revenue Code become final 90 days after they are entered. b. Appealed decisions of the U.S. tax court become final as set forth in section 7481 of the Internal Revenue Code. c. A decision of a U.S. district court normally becomes final if not appealed to the U.S. court of appeals within 60 days of the judgment, decree or order.
d. A decision of the U.S. court of claims or the U.S. court of appeals normally becomes final unless an appeal or a petition for certiorari is filed with the U.S. supreme court within 90 days of the judgment or decree.
e. A decision of the U.S. supreme court is normally final upon the expiration of a period of 25 days from the date the decision is rendered, if a motion for reconsideration or rehearing is not filed within that time.
(5) (c) 4. Examples: 1) Federal adjustments were made to an individual’s 1989 2013 calendar− year basis federal income tax return; the adjustments became final on June 1, 1994 2018. On August 15, 1994 2018, within 90 days after the adjustments became final, the department received the taxpayer’s report of the adjustments. Although the 4−year period provided by s. 71.77 (2), Stats., for making adjustments to the 1989 2013 Wisconsin return expired on April 15, 1994 2018, the department had until November 13, 1994 2018, 90 days after the date the department received a report of the adjustments, to give notice of an assessment to the taxpayer. 2) An individual filed an amended 1993 2015 calendar−year basis New York return on June 1, 1994 2016. An amended Wisconsin return, reflecting the changes on the amended New York return, was filed with the department on July 12, 1994 2016. Under the 4−year assessment period in s. 71.77 (2), Stats., the department has 4 years from April 15, 1994 2016, the due date of the 1993 2015 return, in which to notify the taxpayer of any assessment relating to the changes on the amended New York return. (6) (a) Example: An individual taxpayer filed a 1993 2015 calendar−year basis Wisconsin income tax return on April 15, 1994 2016. The internal revenue service made adjustments to the 1993 2015 federal income tax return which the taxpayer did not report to the department within 90 days after the adjustments became final. The internal revenue service reports these adjustments to the department under the exchange of information agreement between the two agencies on May 1, 1996 2018. The department may issue an assessment for the adjustments any time on or before May 1, 2000 2022.
SECTION 15. Tax 2.105 (6) (b) and (Example) are repealed.
SECTION 16. Tax 2.12 (4) (b) 2. (Example 1), (Example 2), and (Example 3), 3. a. (Example 1), (Example 2), (Example 3), (Example 4), and (Example 5), and (5) (a) are amended to read:
Tax 2.12 (4) (b) 2. Examples: 1) Taxpayer A files an amended 2000 2016 return to claim additional business expenses. The department allows only a portion of the claimed additional expenses, based on a difference in interpretation of the law. A notice of refund is issued March 1, 2003 2019. The taxpayer does not file a petition for redetermination. In December 2003 2019, the taxpayer files another amended return claiming the same additional business deductions as those disallowed in the prior notice of refund. The taxpayer is not entitled to a refund on the claim for refund. The March 1, 2003 2019, notice of refund is final.
2) Taxpayer B files an amended 2000 2016 return to claim additional business expenses. The department disallows a portion of the claimed additional expenses, due to lack of substantiation of the expenses as requested in a letter to the taxpayer. A notice of refund is issued March 1, 2003 2019. The taxpayer does not file a petition for redetermination. In December 2003 2019, the taxpayer submits adequate substantiation to support the full deduction. The deduction is not allowed and no additional refund will be issued. Since no petition for redetermination was filed for the March 1, 2003 2019, notice of refund, that notice is final.
3) Taxpayer C files a timely 1998 2017 return claiming a refund of earned income credit and excess income tax withheld. During the processing of the return the taxpayer is sent a letter requesting additional information to substantiate the earned income credit. The taxpayer does not respond to the request for additional information. A notice of refund is issued in July 1999 2018, to refund the excess income tax withheld only. The taxpayer does not file a petition for redetermination. The taxpayer files a timely 1999 2018 return claiming a refund of earned income credit and excess income tax withheld. During the processing of this return the taxpayer is sent a letter requesting additional information to substantiate the earned income credit. This letter requests the same information that was requested for the processing of the 1998 2017 return. The taxpayer submits the additional information needed for both the 1998 2017 and 1999 2018 returns. Since the taxpayer did not submit a petition for redetermination for the 1998 2017 notice of refund, that notice is final. A notice of refund for the earned income credit is issued for 1999 2018 only.
3. a. Examples: 1) Taxpayer D files a timely 2000 2015 return. The department completes an office audit of this return by issuing a notice of refund dated March 30, 2005 2020. The notice of refund allows an additional itemized deduction credit and disallows a portion of the claimed business expenses. The taxpayer does not file a petition for redetermination. The notice of refund is final, and the taxpayer is not entitled to any refund on a subsequent claim for refund for the disallowed business expenses.
2) Taxpayer E files timely 2000 2015 and 2001 2016 returns. The department completes an audit of the returns and issues a notice of refund dated March 30, 2005 2020. The notice of refund allows an additional itemized deduction credit for each year but also disallows a portion of the claimed business expenses for each year, with the net result being a refund for each year. The taxpayer does not file a petition for redetermination. The notice of refund is final, and the taxpayer is not entitled to any refund on a subsequent claim for refund for the disallowed business expenses.
3) Taxpayer F files a timely 2000 2010 return on April 15, 2001 2011. The department completes an office audit of this return by issuing a notice of additional tax due dated March 30, 2005 2015. The notice of additional tax due allows an additional itemized deduction credit and disallows a portion of the claimed business expenses. The taxpayer does not file a petition for redetermination. The taxpayer has until March 30, 2009 2019, to file a claim for refund for the disallowed business expenses.
4) Taxpayer G files timely 2000 2010 and 2001 2011 returns. The department completes an office audit of these returns by issuing a notice of refund dated March 30, 2005 2015. The notice of refund allows an additional itemized deduction credit resulting in a refund for 2000 2010 and disallows a portion of the claimed business expenses for an assessment for 2001 2011, with the net result being a refund for the two years combined. The taxpayer does not file a petition for redetermination. The taxpayer has until March 30, 2009 2019, to file a claim for refund for the disallowed business expenses for the year 2001 2011.
5) Taxpayer H files timely 2000 2010 and 2001 2011 returns. The department completes an office audit of these returns by issuing a notice of additional tax due dated March 30, 2005 2015. The notice of additional tax due allows an additional itemized deduction credit resulting in a refund for 2000 2010 and disallows a portion of the claimed business expenses resulting in an assessment for 2001 2011, with the net result being an assessment for the two years combined. The taxpayer does not file a petition for redetermination. The taxpayer has until March 30, 2009 2019, to file a claim for refund for the disallowed business expenses for the year 2001 2011.
(5) (a) Beginning on or after January 1, 2015, except as provided in par. (b) or (c), a claim for refund shall be filed on the same form as the original form, in the manner prescribed in sub. (6).
SECTION 17. Tax 2.12 (5) (b) is repealed.
SECTION 18. Tax 2.12 (5) (c) is amended to read:
Tax 2.12 (5) (c) The department may prescribe a special form for taxpayers to use in claiming a refund, to address a specific tax issue. In this situation, the special form may be used in lieu of the amended form prescribed in par. (a) or (b).
SECTION 19. Tax 2.88 (5) (Note 2) and (Note 3) are repealed.
SECTION 20. Tax 2.89 (8) (b) 3. (Note) is amended to read:
Tax 2.89 (8) (b) 3. Note: After the end of the taxable year, persons other than corporations shall use schedule Schedule U and corporations shall use form 4U Form U to determine whether they have made sufficient estimated tax payments. Taxpayers with short taxable years shall adjust the computations on those forms as provided in this section.
SECTION 21. Tax 2.955 (5) (Example) is amended to read:
Tax 2.955 (5) Example: A Wisconsin resident receives income of $4,000 in 2016 2018 from rental property located in Iowa. The person files a 2016 2018 declaration of estimated tax of $200 with Iowa, with $150 of estimated tax payments being made in 2016 2018 and the fourth quarter payment of $50 being made in January 2017 2019. The Iowa income of $4,000 is reported as income on the 2016 2018 Iowa and Wisconsin returns. The 1992 2018 Iowa income tax return shows the following:
Iowa Rental Income | $4,000 |
Estimated Tax Payments | 200 |
The taxpayer may claim a credit for net income tax paid to other states of $185 on the 2016 2018 Wisconsin return, even though a part of the tax was paid in 2017 2019.
SECTION 22. Tax 2.956 is repealed.
SECTION 23. Tax 2.98 (2) (b) (Note 1) and (Note 2) are repealed.
SECTION 24. Tax 3.096 (3) (Note 1) and (Note 2) are repealed.
SECTION 25. Tax 4.001 (2) (a) (intro) is amended to read:
Tax 4.001 (2) (a) (intro) Forms filed with the department shall be submitted as prescribed by the department or by one of the following means:
SECTION 26. Tax 4.001 (2) (b) is repealed.
SECTION 27. Tax 4.75 (3) (a) 2. and (Note) is amended to read:
Tax 4.75 (3) (a) 2. Name of any wholesaler distributor who fails to make timely delayed tax payments. The supplier shall notify the department via facsimile, or FAX, transmittal email or phone within 5 days after the due date of the tax to the department.
SECTION 28. Tax 7.001 (2) (a) (intro) is amended to read:
Tax 7.001 (2) (a) (intro) Forms filed with the department shall be submitted as prescribed by the department or by one of the following means:
SECTION 29. Tax 7.001 (2) (b) is repealed.
SECTION 30. Tax 7.01 (1) is amended to read:
Tax 7.01 (1) Wisconsin wholesalers properly registered and licensed may purchase and receive fermented malt beverages only from registered Wisconsin breweries and wholesalers or from out−of−state firms holding a fermented malt beverage permit. Wisconsin breweries and wholesalers will upon request be furnished with a A list of out−of− state firms having a permit to ship into Wisconsin is available at revenue.wi.gov/Pages/ISE/excise.aspx. SECTION 31. Tax 7.21 is amended to read:
Tax 7.21 Labeling. All fermented malt beverages sold in this state shall be labeled in accordance with federal regulation No. 7, now in effect or as subsequently amended, relating to the labeling and advertising of malt beverages, issued under the federal alcohol administration act regulations 27 CFR 7.1 through 7.81. SECTION 32. Tax 8.001 (2) (a) (intro) is amended to read:
Tax 8.001 (2) (a) (intro) Forms filed with the department shall be submitted as prescribed by the department or by one of the following means:
SECTION 33. Tax 8.001 (2) (b) is repealed.
SECTION 34. Tax 8.22 (2) and (3) are amended to read:
Tax 8.22 (2) Upon request, the department will furnish Wisconsin manufacturers, rectifiers, wholesalers and wineries with a A list of out− of−state permittees duly licensed to ship intoxicating liquor into the state is available at revenue.wi.gov/Pages/ISE/excise.aspx. Purchases may be made and shipments received only from the permittees included on the lists. (3) Upon request, the department will furnish out−of−state permittees with a A list of Wisconsin manufacturers, rectifiers, wholesalers, wineries and other permittees to whom sales and shipments of intoxicating liquor may be made is available at revenue.wi.gov/Pages/ISE/excise.aspx. SECTION 35. Tax 9.001 (2) (a) (intro) is amended to read:
Tax 9.001 (2) (a) Forms filed with the department shall be submitted as prescribed by the department or by one of the following means:
SECTION 36. Tax 9.001 (2) (b) is repealed.
SECTION 37. Tax 14.01 (5) (a) 2. (Example) and (b) (Example) and (7) (b) (Example) are amended to read:
Tax 14.01 (5) (a) 2. Example: A 1998 2018 homestead credit claim filed for the calendar year ending December 31, 1998 2018, must be filed by April 15, 2003 2023.
(b) Example: Claimant A, who filed a 1994 2015 homestead credit claim on May 1, 1996 2017, wishes to file an amended 1994 2015 claim. The amended claim may be filed any time on or before April 15, 2003 2024, since the deadline for filing the original 1994 2015 claim was April 15, 1999 2020.
(7) (b) Example: Claimant A timely files a 1995 2013 claim for homestead credit and receives a homestead credit of $500. On November 1, 2001 2019, Claimant A files an amended 1995 2013 claim for homestead credit claiming a revised 1995 2013 credit of $700. Upon review of the file, the department determines that Claimant A’s correct homestead credit for 1995 2013 is $300 rather than the $500 allowed on the original claim or the $700 claimed on the amended claim.
Since the amended 1995 2013 homestead credit claim will be acted on after April 15, 2000 2018, the last date for adjusting an original 1995 2013 claim, the department must act on the amended claim by November 1, 2002 2020. Prior to that date the department may notify Claimant A that no additional credit is allowable for 1995 2013. However, the $200 of excessive credit allowed on the original claim, the difference between the $500 allowed and the correct credit of $300, may not be recovered by the department.
SECTION 38. Tax 14.02 (9) (Example) is amended to read:
Tax 14.02 (9) Example: A 1997 2017 homestead credit claim filed after the withdrawal of a 1997 2017 farmland preservation credit claim must be filed on or before April 15, 2002 2022.
SECTION 39. Tax 14.04 (3) (e) (Example) is amended to read:
Tax 14.04 (3) (e) Example: A claimant moves on July 1, 1997 2017, from the homestead she owns to an apartment that is exempt from property taxes. She has listed her former homestead for sale with a realtor. While continuing to reside in the apartment, she sells the former homestead; the date on the closing agreement is May 31, 1998 2018. The property taxes accrued on the former homestead are $2,400 for 1997 2017 and the prorated property taxes on the closing agreement are $1,000.
The claimant may file a 1997 2017 homestead credit claim, based on the 1997 2017 property taxes accrued of $2,400 for the entire year. She may also file a 1998 2018 claim, based on the property taxes accrued of $1,000, prorated from January 1, 1998 2018, to the date of the sale.
SECTION 40. Tax 14.05 (8) (b) (Example) is repealed.
SECTION 41. Effective date; general. This rule shall take effect on the first day of the month following publication in the Wisconsin Administrative Register as provided in s. 227.22 (2) (intro.), Stats.
DEPARTMENT OF REVENUE
Dated: By: ___________________________
Peter W. Barca
Secretary of Revenue
E:Rules/171 – Biennial Review – Tax 1, 2, 3, 4, 7, 8, 9, 14 Update – SS 097-19/Tax 1,2,3,4,7,8,9,14 Update Proposed Order
